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> Some people here (who claim to be intimately involved with the actual financial aspects of running a clinic) say it's the opposite -- that Medicare actually

> Some people here (who claim to be intimately involved with the actual financial aspects of running a clinic) say it's the opposite -- that Medicare actually pays the bills so the clinic stays open because the private insurers are so effective at getting out of paying anything. Oh no, definitely not. Granted, the number I cited is for the aggregate, so it's not going to be exactly true for all practices. Things might look different if you're talking about a public clinic that specializes in low-end care for the poor, but by and large, it's definitely the other way around. Medicare is actually quite notorious among physicians for taking ages to remit payments even for bills that they have approved. That said, the dynamic usually goes like this: 1. Patient sees doctor for routine procedure 2. Doctor submits bill for $8,000 to private insurer 3. Private insurer says "no, that's way too much, and also you didn't document this part sufficiently" 4. Doctor resubmits bill with more supporting evidence for that part, but a lower total amount 5. Repeat steps 3-4 an arbitrary number of times 6. Insurer says, "okay, to save work next time we'll agree to pay you 400% of what Medicare does for all of these procedures for the next year". So in that sense, private insurers negotiate their rates, so it seems like they're "getting out" of paying, but in reality they're still paying multiples of what Medicare is. One confusing quirk: most Medicare patients[0] actually have their insurance plans managed by private insurers, so billing and reimbursements for those would be handled by the private insurers. > Surely there is a reliable source that can confirm one way or another how this works in practice? I get that it is probably arcane and difficult to understand, but in a country as vast as the US there is probably someone who understands it well enough to summarize for a layman. The numbers are available in Medicare's annual reports. That's not very user-friendly - last I checked, they were still available in full only on paper(!), and you have to understand financial accounting a little bit in order to parse the numbers yourself. (It's not like they want to make it easy for people to find out how they're under-reimbursing). Though in terms of secondary sources, if you look at documents written by and for other hospital and insurance adminstrators, you'll find a lot of references to this practice. They don't really talk about it more broadly for political reasons, and also because it's something that's really difficult to explain to the public, and because I'm not convinced the public actually cares. > but in a country as vast as the US there is probably someone who understands it well enough to summarize for a layman. There probably is, but getting to my last point - I'm not sure people actually care enough. To be honest, I used to talk about it a lot more on HN (if you search my username + various combinations of "Medicare" or "health insurance", you might find other posts where I've gone into more detail and linked to other materials). But even on HN - let alone with the broader public - I get the sense that most people don't want to understand the complexities of billing and reimbursements and the interchange dynamics between insurers. It makes for a much more complicated narrative than most people are looking for, and so it's easy to gloss over in favor of a simpler one, especially one that fits more neatly into a partisan narrative. [0] Not most people with Medicare (yet), but most Medicare patients (people with Medicare advantage are a minority, but they account for a disproportionate amount of people who actually use their plans - largely because Medicare is damn-near impossible to use as a patient if you're not on a private network. Ask me how I know that one.)

no_wizard 10y ago
I'll bite, how do you know that one? This conversation is incredibly fascinating to me.
- chimeracoder 10y ago
  > I'll bite, how do you know that one? This conversation is incredibly fascinating to me. I have lots of Medicare horror stories, from both personal and professional experience. I founded a health-tech company aimed at ensuring that people who were discharged from the ER received proper outpatient followup care. This is a big problem - most people who leave the ER receive their next medical care from another physician in the ER (ie, a subsequent visit). There are a lot of reasons that patients don't have followup care, but a big one is the amount of coordination and effort required. A lot of that we could automate or do efficiently, because we were handling the process for many patients at once. But dealing with Original Medicare[0] was particularly awful. Original Medicare's coverage is actually quite terrible (from the patient's perspective) and, to make matters worse, lots of providers don't accept Original Medicare[1], because it's a lot of hassle and may not even pay for itself. We had by far the hardest time with Original Medicare patients compared to Medicare Advantage patients. Even Medicaid was arguably better, for reasons which aren't relevant here. From a personal standpoint, I've seen how frustrating it is to arrange for proper care for family members on Medicare, and that's with the knowledge we have about how the whole system works together. For ongoing care, such as physical therapy or dialysis[2], Medicare will often cover a small amount, but not enough to really make an impact. Say, you need three sessions a week, but Medicare only covers one. However, because providers can't bill a patient directly for services that Medicare does cover (even if Medicare won't cover that service, because the patient has hit their cap, or whatever reason), that means you... can't receive it from that same provider. So you have to find a different provider for the remainder, which means you now have two different providers and all the problems that means. That is, of course, assuming you manage to find one who will let you self-pay, and you have to cover it out of pocket. To be fair, that last point applies both to Original Medicare and Medicare Advantage; Original Medicare just happens to be worse about it. [0] Original Medicare is the term used for Medicare plans that aren't offered through private insurers [1] e.g. http://www.oregonlive.com/finance/index.ssf/2015/10/medicare_2015_more_doctors_rej.html http://www.oregonlive.com/finance/index.ssf/2015/10/medicare... [2] Dialysis is actually particularly heinous for another reason - due to a legal loophole, Medicare basically forces private insurers to pay for nearly all dialysis, albeit indirectly.

no_wizard 10y ago

I'll bite, how do you know that one? This conversation is incredibly fascinating to me.

chimeracoder 10y ago
> I'll bite, how do you know that one? This conversation is incredibly fascinating to me. I have lots of Medicare horror stories, from both personal and professional experience. I founded a health-tech company aimed at ensuring that people who were discharged from the ER received proper outpatient followup care. This is a big problem - most people who leave the ER receive their next medical care from another physician in the ER (ie, a subsequent visit). There are a lot of reasons that patients don't have followup care, but a big one is the amount of coordination and effort required. A lot of that we could automate or do efficiently, because we were handling the process for many patients at once. But dealing with Original Medicare[0] was particularly awful. Original Medicare's coverage is actually quite terrible (from the patient's perspective) and, to make matters worse, lots of providers don't accept Original Medicare[1], because it's a lot of hassle and may not even pay for itself. We had by far the hardest time with Original Medicare patients compared to Medicare Advantage patients. Even Medicaid was arguably better, for reasons which aren't relevant here. From a personal standpoint, I've seen how frustrating it is to arrange for proper care for family members on Medicare, and that's with the knowledge we have about how the whole system works together. For ongoing care, such as physical therapy or dialysis[2], Medicare will often cover a small amount, but not enough to really make an impact. Say, you need three sessions a week, but Medicare only covers one. However, because providers can't bill a patient directly for services that Medicare does cover (even if Medicare won't cover that service, because the patient has hit their cap, or whatever reason), that means you... can't receive it from that same provider. So you have to find a different provider for the remainder, which means you now have two different providers and all the problems that means. That is, of course, assuming you manage to find one who will let you self-pay, and you have to cover it out of pocket. To be fair, that last point applies both to Original Medicare and Medicare Advantage; Original Medicare just happens to be worse about it. [0] Original Medicare is the term used for Medicare plans that aren't offered through private insurers [1] e.g. http://www.oregonlive.com/finance/index.ssf/2015/10/medicare_2015_more_doctors_rej.html http://www.oregonlive.com/finance/index.ssf/2015/10/medicare... [2] Dialysis is actually particularly heinous for another reason - due to a legal loophole, Medicare basically forces private insurers to pay for nearly all dialysis, albeit indirectly.